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Housing Prices Stay Hot in Warmer Climates

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Tuesday, September 24, 2019

The Case-Shiller National Home Price Index for July was released before the bell this morning, reaching a headline level of 3.2% year over year, identical with the upwardly revised level for June. These figures are obviously a month in arrears, but are considered among the most solid of domestic housing metrics overall.

Both the 10-City and 20-City Composites have slipped somewhat — to +1.6% and +2.0%, respectively — with long-time grower Seattle the only major city to post an overall price decline. Home price value leaders were all in southern climes: Phoenix +5.8%, Las Vegas +4.7% and Charlotte +4.6%.

Case-Shiller had been illustrating an upward trajectory overall from February 2012, with some softness experienced in the past year or so. We are still way off the peak housing levels reached in the years prior to the Great Recession, when a housing bubble led to global economic collapse.

After the opening bell, we expect a new report on September Consumer Confidence. For August, we saw a read of 135.1 — a tad lower than the 135.8 headline we saw in July, but still near 10-year highs. The consumer, as market participants know, has been most valuable to overall economic performance in the U.S., fending off manufacturing headwinds, slowdowns overseas, and of course the year-long U.S.-China trade war.

When the regular day of trading closes today, we’ll hear from Nike (NKE - Free Report) in its fiscal Q1 2020 earnings report. Expectations are for the company to bring in 71 cents per share (+6% year over year) on $10.45 billion in quarterly sales. The company has only missed earnings estimates once in the past five years, but that quarter was for Q4 2019 — the most recently reported.

We shall see if things like the trade war are making it more difficult for Nike to outperform expectations. The Zacks Rank #4 (Sell)-rated company — the largest shoe retailer in the world — is trading at a 28x+ forward multiple, so beating expectations look to be important for the company. Shares are only up 4.1% year to date. For more on NKE’s upcoming earnings, click here.

Mark Vickery
Senior Editor

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